Gold price marching ahead, as US dollar restrained

Gold and American dollar trending points

The Spot gold price has been fanning the flames of further gains, as American dollar had faltered and would likely to fall further, as Fed is likely to keep the interest rate unchanged amid geo-political tension and outcry on Wall St.

The American Dollar has been testing its long term moving average support, as it has been trading below its 95.22, its lowest level since the October 16th, 2018.

Gold space-dives, likely to gain further as American dollar ditched to October, 2018 low

US dollar has been smearing its ongoing muzzling in the muds, as the Spot gold price has started to skyrocketing. After the latest spot gold uptick followed by gloomier investors’ sentiment ahead of FOMC minutes, due later this week on Friday, February the 1st, 2019, and a gauge of distressful data dislodging the global stock momentum, it has taken out the multi-month resistance, leaving the precious metal at its best level since June 2018.

Investors’ leering on to safe-haven gold and government bonds, amid intense market volatility

As the quarter one of 2019 has been echoing the lead of fourth quarter of 2018, with intense market volatility, displaying, one week up & next week down, the investors’ sentiment had broadly shifted towards safe haven currencies like Japanese Yen and commodities like gold. Apart from that, the Fed Chair, Jerome Powell is likely to maintain his dovish tone in the upcoming FOMC minutes, due later this week and the US dollar may have been drowned further below its initial support level at 94.75 at a 30-day moving average.

As the US non-farm payroll data may have weighed on to a downbeat American dollar and the consumer spending is likely to fall apart, in the face of ongoing political gridlock, which factually has been forcing the Trump Administration to initiate another Federal government shutdown from February 15th, since the recent momentary opening of federal government without funding Trump’s $5.6 billion over the Mexican border wall, had been considered widely as a landslide political loss for the Trump administration, against the Democrats, who had been hailing on the US house of representatives followed by the US mid-term election

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Spot gold daily price chart

Bottom Line

Despite a much-softened American dollar, with further weakening on the cards, the spot gold’s raise may have been limited by the temporary opening of Federal government, as consumer spending index is likely to rise this week, offering slight support to the downbeat American dollar.

Amid intense political outcry and ahead of a plausibly dovish FOMC minutes, the Spot gold would likely to surge further, while the initial resistance level is lying at $1326.56 per ounce, which if broken, could pave the way for further raise above $1,365 per ounce. On the flipside, a downbeat gold may not appear in the remaining days of this week, as FOMC minutes would keep haunting the investor’s confidence and geo-political tension would continue to supplement the appetite for safe-haven assets like the precious metal.

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